SBJ/20090202/This Week's News

Selig’s pay climbs past $18 million

MLB Commissioner Bud Selig earned $18.35 million for the league’s fiscal year ended Oct. 31, 2007, an amount up 22 percent from the prior year and one that again places him among the highest-paid individuals in all of sports.

Selig’s pay is outlined in MLB’s most recently filed tax documents for the Office of the Commissioner. The amount covers the last full year of work for the longtime commissioner before he agreed to a three-year contract extension in January 2008 that will keep him in the post through 2012. That deal, at the time of its signing, was believed to call for further salary increases.

The compensation to Selig outlined in the tax filing includes $17.47 million in base compensation, $461,540 in contributions to employee benefit plans, and $422,590 in expense accounts and other allowances. Selig’s total marks the largest chunk of a $98.9 million outlay in total employee compensation and benefits to the 242-person MLB office. That entire employee expense is up 16 percent from the $85.1 million listed for a 236-employee office in the prior year’s tax return.

Selig’s earning power has surpassed that of other league commissioners for at least several years, and his 2007 compensation is more than most MLB players, too. Only the New York Yankees’ quartet of Alex Rodriguez, Derek Jeter, Roger Clemens and Jason Giambi earned more than Selig in 2007. Entering 2009, only seven MLB players will earn more this year than Selig’s $18.35 million of two years ago.

A historical look at the annual compensation for MLB Commissioner Bud Selig
2007 $17.470 million $461,540 $422,590 $18.35 million
2006 $14.515 million $400,999 $140,603 $15.06 million
2005 $14.500 million $82,843 $20,184 $14.60 million
Notes: MLB fiscal year is the 12-month period ending on Oct. 31 of the year listed.
Source: MLB tax filings
A look at how MLB Commissioner Bud Seligs compensation compares to that of some of his contemporaries. Each number listed is for a fiscal year that ended in 2007, the most recent year for which information was available.
MLB Bud Selig $18.35 million
NFL Roger Goodell $11.2 million (prorated)*
NBA David Stern $10 million (est.)^
NHL Gary Bettman $5.59 million
PGA Tour Tim Finchem $4.8 million
* Prorated based on $6.5 million earned for the first seven months on the job (Sept. 1, 2006, through March 31, 2007). The NFLs return outlining Goodells first full year as commissioner is expected later this year.
^ Stern is believed to garner about $10 million annually, but the precise amount is not known. The NBA does not structure its central office as a tax-exempt entity, so it is not required to disclose its tax returns.
Source: SportsBusiness Journal archives

During the fiscal year covered in the tax filing, MLB posted league-record marks of 79.5 million in attendance and $6.075 billion in overall revenue. The revenue mark has since been eclipsed.

The latest tax filing is the second consecutive one to list only the compensation of Selig and not that of MLB President Bob DuPuy or any executive vice presidents. Those amounts had been listed in prior filings.

Last year’s filing had the names of DuPuy and other senior staffers but without pay totals. The current return omits those names entirely, with Selig joined only by unpaid members of the league’s executive council, a group consisting mainly of team owners.

The omission of those senior staff compensation totals contradicts IRS filing requirements, nonprofit tax experts said.

“This rule is still on the books: The nonprofit needs to report the officers, directors and key employees, along with their compensation,” said Marcus Owens, former director of the IRS’s exempt organizations division and now an attorney with Caplin & Drysdale in Washington, D.C., representing nonprofits. “They arguably have filed what could be considered an incomplete return.”

MLB executives declined to comment, but they disagreed last year with the claim that additional salaries should be listed.

The return will likely be the final one available to the public anyway, as the Office of the Commissioner has since gone through a change in filing status to become a for-profit limited liability corporation. MLB executives have said the move is tax-neutral for the league, but they have not articulated how that was achieved or, if that is indeed the case, why it was not pursued previously. DuPuy said in August that the switch, while motivated in part by a desire to avoid further public disclosures, would “better reflect the nature and structure of our business.”

The change relieves MLB of IRS disclosure rules that went into effect last year for 2008 and beyond mandating the listing of up to 20 employees of nonprofit entities who earn more than $150,000 and carry significant functional responsibilities.

Gross receipts for the commissioner’s office, generated almost entirely by dues levied on the individual MLB clubs, rose 14 percent during the fiscal year to $141.3 million.

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